The bombs keep flying and the blood of civilians keeps spilling in the Middle East. The conflict in Gaza City escalating overnight. An Israeli missile taking out a two-story home, 11 people were killed, including four children. The attacks continuing this morning. Representatives of Israel and Hamas in Egypt separately for ceasefire negotiations.

Hamas offering up its demand for a truce insisting Israel end its military blockade of Gaza if it wants the bombing to stop. Arwa Damon joining us by phone from Gaza City this morning. Meanwhile, Arwa, Israel saying that Gaza needs to let up its violence first so neither side appears to be giving in. What is the latest from the region?

DAMON (via telephone): Well opposition is certainly being maintained by both. Neither at this point saying that they do want to back down. You're speaking about the stalemate that was killed there during the funeral for that family.

We thought three rockets being fired from Gaza City, and our Ben Wedeman who is at the funeral itself said that after they heard the third outgoing rocket, mourners were chanting for revenge and all the Israeli defense forces are saying that 550 rockets have been fired from Gaza into Israel and that the Israelis have struck approximately 1,350 targets in this area, one of the most densely populated areas in the world.

We also saw a strike just a short while ago that seems to have been targeting one of the locations where the rockets were fired from. Residents in the area telling CNN that the Israeli strikes hit an open field. And to just give you an idea of the lay of the land here, while it is very densely populated, there are small, open areas in between some of these narrow alleyways.

And that is where many of these rocket launching units will fire from. And then, of course, there's the retaliatory strikes from the Israeli side. But again, as is always the case, not just in this conflict but in all conflicts of this nature, it is constantly the civilians that are paying the price. CHO: And if those negotiations continue, obviously, so do the rockets and the missiles, Arwa, as you point out. I know you have covered this region for quite some time. You've made many tricks there. I'm just curious to know, from your standpoint, how does this differ right now in terms of mood and atmosphere from your earlier trips?

DAMON: Well, it differs, first and foremost, on the one level, but the dynamics of the Middle East have changed so drastically in the last two years since the Arab spring began. The last time that the Israeli defense forces launched a war in Gaza (ph) was back in 2008- 2009. And back then, for example, they could staunchly rely on Mubarak's Egypt as an ally.

Right now, of course, Egypt is being led by a Muslim Brotherhood government, very, very close to Hamas, itself. That has changed the dynamics here. But what always stays the same is the sense amongst the people in Gaza that this is somehow their fate. This is the cycle of violence that they have constantly have to deal with for decades right now.

And many of them, although, they are incredibly enraged at the ongoing strikes by Israelis, they're enraged by the way that they feel that they're constantly being treated, being humiliated, being forced to live in these conditions. There's still this overwhelming desire to just somehow see an end to it all. So many people we were talking to saying that, in the long-term, all that they really want to see is peace, but that of course, is what remains to be ever elusive when it comes to ongoing conflicts between the Palestinians and the Israelis.

CHO: Let's hope that they can reach a ceasefire in the coming days. U.N. Secretary General, Ban Ki-Moon, as you know, Arwa, among those headed to the region right now. Arwa Damon live by phone from Gaza City. Arwa, thank you -- Christine.

ROMANS: Alina, as the fighting intensifies, Israel has a new line of defense, the Iron Dome system. One of the men in charge of it says the missile defense technology has picked off hundreds of rockets coming from Gaza, but he also says it has its flaws. Here's Fred Pleitgen.

(BEGIN VIDEOTAPE)

FREDERIK PLEITGEN, CNN INTERNATIONAL CORRESPONDENT (voice-over): A kill (ph) that possibly saves lives on the ground. This video shows an iron dome missile intercepting a rocket fired from Gaza at Tel Aviv on Sunday. The defense system had just been installed at Israel's largest city a few hours earlier.

Several days into the conflict, it's already clear the iron dome is having a big impact picking off hundreds of rockets. I got a tour of the Israel aircraft industry's plant that assembled the air defense system. Dr. Israel Oznovich (ph) is one of those in charge. One key element is an advanced radar.

UNIDENTIFIED MALE: The radar such as locates tracks and intercepts and guides the intercepting missiles within several seconds, few seconds within the launching time. PLEITGEN: It's extremely hard to shoot down short-distance rockets like the ones coming out of Gaza in part because they're not in the air long enough for older radar systems to lock onto them.

UNIDENTIFIED MALE: The target is moving extremely fast. When you want to intercept it, you have to work -- you have to move faster with more agility, with more maneuvering power relative to your target.

PLEITGEN: The iron dome was only put into service in 2011. With breakthroughs in technology, it can detect and shoot down multiple targets in midair. But it isn't a perfect solution. This is the aftermath of a rocket strike in the town of Ashkelon.

(on-camera): One of the rockets that hit Ashkelon came here and hit this car port, and as you can see, did substantial damage to the car, as well. The iron dome system has been billed as a game changer in this conflict. But as hits like this one show, it cannot intercept all the rockets that are coming at Israel from Gaza.

(voice-over): Still, Israel's military says it's very happy with the performance of the interceptor system. MAJ. ARYE SHALICAR, ISRAELI DEFENSE FORCES: -- down, usually down. Usually, these rockets are exactly the ones who are launched from the Gaza Strip from terrorist factions towards the biggest cities where you have more people living. We usually down them, but it's not a 100 percent solution unfortunately.

PLEITGEN: And so the engineers at the assembly plant are working extra hours to assemble more iron dome batteries for immediate deployment.

Fred Pleitgen, CNN, Ashkelon, Israel.

(END VIDEOTAPE)

ROMANS: So, what does this cost? Let me dig into the costs of the system for you. It costs $62,000 every time a missile is fired from the iron dome. In 2011, the Israeli military said the system had a 70 percent success rate. And the United States has allocated about $275 million for Israel's iron dome system.

CHO: President Obama addressing the people of Myanmar during his historic visit there.

(BEGIN VIDEOTAPE)

CHO (voice-over): In a speech at the University of Yangon, he praised the country for its remarkable journey toward democracy and said further reforms are needed. He's the first sitting U.S. president to ever visit the country. He also met with activist, Aung San Suu Kyi, at the home where for 15 years she was a political prisoner.

ROMANS (voice-over): Here in the U.S., more than 3,000 people rallying outside the White House in opposition to proposed Keystone XL Pipeline. That pipeline would help deliver oil from Canada's tar sands all the way down to the Gulf of Mexico. Last year, the Obama administration delayed a decision on the controversial project, delayed it until after the election.

CHO: Listen to this story, a family affair in Texas, where a father and his two adult children are accused in a string of bank robberies. Authorities say Ronald Scott (ph) and his 20-year-old son Hayden robbed the banks while they're daughter, 18-year-old Abby, drove the getaway car. The family is believed to be responsible for two bank heists in Texas and five others in Oregon.

ROMANS: Believe it or not, tow trucks are in huge demand after Hurricane Sandy.

(END VIDEOTAPE)

ROMANS (on-camera): But police, Alina, police are warning folks to watch out because they could be ripped of by some of them. We're going to explain coming up.

(COMMERCIAL BREAK) ROMANS: A look at the president, Air Force One, he's arriving in Cambodia, in Phnom Penh, Cambodia. He's on this Asia trip. So interesting, you know, the White House saying that the United States is going to engage -- re-engage in the region. Fascinating, too, because you know, China is a raising economy, a rising power with huge influence in North Korea and all of the important -- the important, you know, situations in the region that the U.S. also has interests in.

So, this is the United States and a president that has been re-elected choosing as its first big foreign trip to take Asia as the place where it's going to be. And you can see the dignitaries arriving there to greet the president as Air Force One lands in Cambodia. So, this is the next stop, of course, after Myanmar for the president and his team this morning.

Again, these are live pictures of Air Force One. Air Force One on the tarmac there in Cambodia.

All right in other news. New York's Hugh L. Carey Tunnel will be open for business this morning three weeks after getting flooded out by the storm surge caused by Hurricane Sandy. Both tubes of what used to be called the Brooklyn Battery Tunnel will open at 6:00 a.m., just in time for the Monday morning commuters. It's almost impossible to believe, but you look at those pictures and you see how flooded this tunnel was, and that it can be open now.

They've been pumping it dry now for days. On an average work day, this tunnel carries about 50,000 cars, and certainly, a lot of people going between Lower Manhattan and Brooklyn are going to be happy to be able to use it again today, Alina.

CHO (on-camera): That's right. That's 50,000 happy commuters. All right, Christine. It's been hard enough for many New York and New Jersey residence to deal with the damage caused by Hurricane Sandy. The storm destroyed homes, took out power, and forced people to wait on line for hours just to get some gas.

Now, detectives are warning those same hurricane victims to be on the lookout for scammers driving tow trucks. Our Susan Candiotti has more.

(BEGIN VIDEOTAPE)

SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT (voice-over): Tow trucks are in huge demand after Sandy. And police are keeping an eye on them.

UNIDENTIFIED MALE: There are still cars sitting out here. They got to go.

CANDIOTTI: Since the storm, they've been clearing the way for emergency vehicles, getting rid of destroyed cars, hauling away boats swept into the middle of the street. But as police learned in Katrina, disasters are prime territory for shady operators to steal cars, targeting older models that can be sold at junk yards without paperwork, 500 bucks a pop.

UNIDENTIFIED MALE: Actually, there's no writing on the truck. So, I'm even more curious about this guy.

CANDIOTTI: We shadowed the New York police auto crime unit, spot- checking towers, making sure they're towing the line.

DET. JOSEPH WEDGE, NYPD AUTO CRIMES: A truck that isn't marked. They might not have the proper equipment on the truck, not proper documents, unlicensed drivers, not paperwork.

CANDIOTTI: At night, it's often easier to get away with illegal tows.

WEDGE: It's pitch black out here. You can't see anything. It's very dark. They can sneak in and out of neighborhoods, grab cars and leave.

CANDIOTTI (on-camera): Along the way, we stop at this lot where a lot of tow trucks have dropped off their vehicles. You see the markings here? It has to do with insurance company, and you can see the condensation that's still inside this car. Over here, this SUV, is filled with muck from the ocean. What a mess inside that engine. And this car still has water in the headlights. Let's give eight a shake so you can see it.

(voice-over) Most are totaled. Some will be auctioned for parts, but others will be sold often without the buyer knowing it was in a flood and that can be a safety hazard.

DET. CHRISTOPHER CONNOLLY, NYPD AUTO CRIMES UNIT: Anything from electrical problems to not running correctly, all your lights. Just everything. Not performing. There's a reason why the insurance company totaled it out and didn't fix it. It's not worth fixing.

CANDIOTTI: For now, police are monitoring the lot to make sure cars don't disappear without permission. In Seaside Heights, New Jersey, authorities seized records of one towing company. Prosecutors are investigating whether the business improperly hauled away storm damaged boats and cars and overcharged owners to get them back. After several attempts, we were unable to reach the company for comment.

UNIDENTIFIED MALE: Yes, there's a (INAUDIBLE) I believe van or an SUV. You want to see --

CANDIOTTI: No trouble on this patrol. New York police hope their efforts keep illegal tow trucks off the road.

Susan Candiotti, CNN, New York.

(END VIDEOTAPE)

CHO: And to find out thank you help the victims of Superstorm Sandy, head to our website, CNN.com/Impact.

ROMANS: And I think you'll see used car prices rising.

(CROSSTALK)

ROMANS: A lot of used cars sitting on the lot have, you know, just outward-ding damage, you know, and people want a nice, you know, clean, so I think you'll see used car prices are going to rise a little bit.

All right. The Mile High City has got a sky high visitor. Up next, some serious objects (ph) buzzing above Denver. It's got folks scratching their heads. Is there an earthly explanation?

CHO: Or not.

(COMMERCIAL BREAK)

ROMANS: It's about 50 minutes after the hour. Let's get you up to date on the morning's top stories.

(BEGIN VIDEOTAPE)

ROMANS (voice-over): Eleven civilians are dead in Gaza City, killed by an Israeli air strike. Four of the dead are children. Right now, representatives of Israel and Hamas are in Egypt for ceasefire talks. Hamas demanding an end to Israel's military blockade in Gaza in order to end the violence.

Israelis insisting they'll finish the job with a ground offensive if air strikes don't end the conflicts.

CHO (voice-over): President Obama praising Myanmar's rapid political reforms during his historic visit there. The first sitting U.S. president to travel to that country. Mr. Obama also met with fellow Nobel Peace Prize winner, Aung San Suu Kyi, who spent 15 years under house arrest in Myanmar. She expressed concern about a, quote, "mirage of success" in Myanmar's reforms.

UNIDENTIFIED MALE: And the American Music Award goes to -- Justin Bieber!

ROMANS: That's cool. Don't stop believing. Justin Bieber sweeps the American Music Awards, winning all three categories in which he was nominated, including the biggest award of the night, Artist of the Year. And his mom was on stage. Other big winners, Taylor Swift, Rihanna, Carly Rae Jepsen, and Nicki Minaj, but probably one of the oddest performances ever, I give you M.C. Hammer -- Gangnam style.

(MUSIC PLAYING)

ROMANS: That is cool.

CHO: I like it.

(END VIDEOTAPE)

ROMANS (on-camera): I do, too. I like it, too. CHO (on-camera): I like it. You know, I was at the Madonna concert earlier last week, actually, and he flew in from Frankfurt to perform with Madonna. Madonna is a huge fan of PSY.

ROMANS: Excellent, all right.

CHO: Worldwide sensation.

And how about this? Mysterious objects seen buzzing around the skies above Denver have some people talking UFO. That's right. Local TV station says a man gave him that home video that he claims shows unidentified flying objects zigzagging over the mile-high city. It is unidentified and it is a flying object, so that's accurate.

Cameraman who wishes to remain anonymous says the UFOs have been appearing several times a week, usually between noon and 1:00 p.m. So, the station set up their own camera at that time. And guess what? They got a similar result.

MARCIANO: I mean, that may cause some funky things to happen. Anyway, further scientific investigation required. Good morning, girls.

ROMANS: Good morning.

MARCIANO: Looking at some showers across parts of the midsection of the country and also some dense fog from Detroit back through much of the lower end, Chicago up through Milwaukee. Temperatures run out of few phrasing mark (ph), and it's kind of thick and soupy. So, some slow travel there. But these showers will be fairly light right now. But the big storms are lining out west. Portland to Seattle, it's just a mess this morning. Flood watches are out. (INAUDIBLE) will be rising. Some wind with this also. We have winds nearly 100 miles an hour along the Oregon coastline there, Yaquina Head 98-mile-an-hour wind gusts and Garibaldi 79 mile-an-hour wind gusts, and it's breezy this morning.

Snow levels will be rising. Rainier is going to get a ton of it here, but it's mostly above the mountain passes. So, that's not going to be much of an issue. So, mostly in the form of rain and we've got flood watches that are out, three, four, five, six, seven or eight inches across parts of the coast range possible here. It's going to be a three-day event coming at you. So, intense situation there. So Cal looking good. Much of the midsection of the country fairly dry. The northeast dry, as well. Forty-nine degrees expected in New York City for a high temperature, 54 degrees in D.C., and 66 degrees, not a bad looking day, in Atlanta.

I think maybe more disturbing we're seeing M.C. Hammer do that Gangnam style.

(LAUGHTER)

MARCIANO: But the parachute pants are back.

ROMANS: I was going to say, I just love to see a picture of you in your parachute pants.

CHO: Oh, you know you wore them, Rob.

MARCIANO: Absolutely.

(LAUGHTER)

CHO: Oh, yes. Hey, did I see you in a Formula 1 car recently?

MARCIANO: Yes, yes. Austin had the first Formula 1 race in like five years, and I got to take a test ride around that track a couple of weeks ago.

CHO: Yes. You look right at home. All right, Rob. Thanks so much.

ROMANS: The wind and the pair (ph) and then his parachute pants.

But first, President Obama may not be impressed, but she is (INAUDIBLE). Up next, the story behind this White House photo, and that face.

(COMMERCIAL BREAK)

ROMANS: Welcome back. It's 58 minutes after the hour here with Alina Cho. Take a look at this top CNN trends on the web this morning.

A White House photo of President Obama and teen USA gymnast, McKayla Maroney, have gone viral. And clearly, they are both not impressed. Maroney became an Internet meme when she flashed her not impressed face on the victory podium at the London Olympics after winning a silver.

That photo became a worldwide sensation, one that reached all the way to the White House. Maroney says the new photo was the president's idea.

(LAUGHTER)

CHO: All right. We'll take that at face value. New Jersey Governor Chris Christie providing some comic relief from Superstorm Sandy on "Saturday Night Live." Have a look. (BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Look, is there anything while you're here you'd like to say to the people of New Jersey?

GOV. CHRIS CHRISTIE, (R) NEW JERSEY: WELL, SURE. If I could, I'd like to thank some people. I'd like to thank the Red Cross and first responders. I'd also like to give a special thanks to my lovely wife, Mary Pat Christie, who's here tonight who put up with a husband who has smelled like a wet fleece for the past three weeks.

(LAUGHTER)

UNIDENTIFIED MALE: You have been wearing that fleece a lot.

CHRISTIE: Oh, yes. It's basically fused to my skin at this point.

(LAUGHTER)

UNIDENTIFIED MALE: But I have seen you wearing suits.

CHRISTIE: Oh yes, but I wear them over the fleece. I'm going to die in this fleece.

(LAUGHTER)

CHRISTIE: But that's OK. It's a good fleece.

UNIDENTIFIED MALE: It is a good fleece.

CHRISTIE: Stop saying things I've already said.

UNIDENTIFIED MALE: All right, OK!

(LAUGHTER)

CHRISTIE: I also would like to not thank the following. I do not thank any of the stupid mayors who ignored my evacuation orders. You're idiots! And when you ignore me, it makes you look like a real Seth Meyers.

UNIDENTIFIED MALE: Oh, come on!

CHRISTIE: I'm speaking here.

UNIDENTIFIED MALE: All right. CHRISTIE: I also do not want to thank the reporters that put themselves in danger, you know, by walking into the middle of the hurricane with their cameras. We don't need you to tell us there's a hurricane. We have windows!